Business Secret: Smarts
As venture capitalists, my partners and I meet dozens upon dozens of entrepreneurs pitching their ideas and dreams. We love them - especially when their passion comes with capabilities and a good idea. I have been fascinated in understanding the "DNA" of great entrepreneurs in an effort to identify traits and markers that can serve as early clues for future success. I have come to conclude that great entrepreneurs share and need SGL: Smarts, Guts, and Luck.
Smarts. If you eat horseshoes for breakfast and always win in Vegas, then all the better for you. You ain't the norm. "Smarts" is the best foundation for any entrepreneur. Entrepreneurial smarts, however, needs to be defined and it certainly requires going beyond traditional MBA education. If I were honest, and not influenced by the fact that I hold one of these degrees myself from the institution closely affiliated to this site, then I would say that there's a lot of truth in what my partner Mats Lederhausen has said: "Most MBA's make for sucky entrepreneurs." This is not because they are not smart, but because an MBA--while potentially helpful--is not a requirement. Other smarts are.
The best self-made entrepreneurs possess outstanding street smarts, intuition, emotional and conceptual intelligence as much as--and often more so than--book smarts, analytics, and managerial intelligence. It is why founders are usually very good getting companies to a certain level, but usually less good at scaling their idea. The CEO who scales a company probably did could not have founded the business and, vice versa, the person who founded it probably could not have scaled it. The exceptions of Michael Dell, Steve Jobs, Bill Gates, and Howard Schultz are just that: exceptions. They possessed the rare capability to bridge across the analytical and the creative, across the left and the right side of the brain. For our early stage investments, I am biased toward the right side- the more creative, conceptual and street smarts. "Visionary Skills 101", just does not seem to be on many MBA curriculums.
At the early stage of a business it is critical to build culture before company. The culture comes from the evangelism, heart, and fire in the belly of founders. You need to create a belief system, energy, and inspiration during the early stage of business and, as it grows, balance that with structure and process. If you put the latter (left side thinking) too early you lose the chance to form the soul of the company - you basically begin managing when the company has not yet been led.
Smarts. If you eat horseshoes for breakfast and always win in Vegas, then all the better for you. You ain't the norm. "Smarts" is the best foundation for any entrepreneur. Entrepreneurial smarts, however, needs to be defined and it certainly requires going beyond traditional MBA education. If I were honest, and not influenced by the fact that I hold one of these degrees myself from the institution closely affiliated to this site, then I would say that there's a lot of truth in what my partner Mats Lederhausen has said: "Most MBA's make for sucky entrepreneurs." This is not because they are not smart, but because an MBA--while potentially helpful--is not a requirement. Other smarts are.
The best self-made entrepreneurs possess outstanding street smarts, intuition, emotional and conceptual intelligence as much as--and often more so than--book smarts, analytics, and managerial intelligence. It is why founders are usually very good getting companies to a certain level, but usually less good at scaling their idea. The CEO who scales a company probably did could not have founded the business and, vice versa, the person who founded it probably could not have scaled it. The exceptions of Michael Dell, Steve Jobs, Bill Gates, and Howard Schultz are just that: exceptions. They possessed the rare capability to bridge across the analytical and the creative, across the left and the right side of the brain. For our early stage investments, I am biased toward the right side- the more creative, conceptual and street smarts. "Visionary Skills 101", just does not seem to be on many MBA curriculums.
At the early stage of a business it is critical to build culture before company. The culture comes from the evangelism, heart, and fire in the belly of founders. You need to create a belief system, energy, and inspiration during the early stage of business and, as it grows, balance that with structure and process. If you put the latter (left side thinking) too early you lose the chance to form the soul of the company - you basically begin managing when the company has not yet been led.
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